IN THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF PENNSYLVANIA

LARRY PANETTA, : CIVIL ACTION

Plaintiff, :

:

v. : NO. 05-4511

:

SAP AMERICA, INC., et al., :

Defendants. :

MEMORANDUM AND ORDER

Stengel, J. September 20, 2006

The plaintiff, Larry Panetta, filed a motion with the court on July 5, 2006, (1)

requesting the court to reconsider its Order of June 22, 2006, and (2) for leave to amend

the complaint to add class action allegations and a claim of quantum meruit/unjust

enrichment. The court's June 22nd Order struck from the plaintiff's Second Amended

Complaint (1) class action allegations because they were in violation of this court's order

of April 6, 2006, and (2) a quantum meruit/unjust enrichment claim because the plaintiff

did not request leave to amend the complaint substantively. The defendants filed their

memorandum of law in opposition to the plaintiff's motion for reconsideration and leave to

amend on July 19, 2006. For the reasons stated below, I will deny both the motion to

reconsider and the right to amend the complaint.

I. BACKGROUND

This case arises out of a contract dispute between Mr. Panetta and his former

employer, SAP America, Inc. ("SAP"). During the last several years that Mr. Panetta

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worked at SAP as a solution engineer, in particular the years 2000-2004, his employment

focused on solidifying a business "opportunity" for SAP with the United States Postal

Service ("USPS"). In 2004, SAP and USPS executed a software licensing contract. 

Mr. Panetta claims that he was not paid commissions that were owed to him due to

his efforts in closing the $14,650,000.00 contract with the USPS. Mr. Panetta alleges that

the terms of the pre-2004 Compensation Plans ("pre-2004 Plans") should determine the

amount of his commission on the USPS contract, which would entitle him to

approximately $250,000.00. According to Mr. Panetta, however, SAP unilaterally

changed its compensation agreement with all solution engineers upon completion of the

USPS contract and prior to its execution. This new compensation agreement reduced his

commission for the USPS project to $12,400.00

Defendants oppose Mr. Panetta's breach of contract and Pennsylvania Wage

Payment and Collection Law claims. They allege that the SAP 2004 Compensation Plan

should govern the amount of Mr. Panetta's commission for the USPS contract. Under the

defendants' argument, the SAP compensation plans were only in effect for the

corresponding calendar year, the commissions were earned in the year in which the

contract was executed, the USPS contract was executed in 2004, and, therefore, the 2004

Plan should determine Mr. Panetta's USPS commission.

Mr. Panetta initiated this case in the Northern District of California. The case was

transferred to the Eastern District of Pennsylvania, at which point Mr. Panetta amended his

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Federal Rule of Civil Procedure 23 sets forth the requirements for class certification. It is a two prong test, 1

which is spelled out infra in Section II.B. 

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complaint to include the claims under Pennsylvania law and class action allegations. With

regard to the class action, Mr. Panetta purported to represent a class of SAP employees

who worked on the USPS contract and were affected by the unilateral change in the

compensation plan. On April 6, 2006, this court granted the defendants' motion to strike

the class action allegations. Panetta v. SAP Am., Inc., No. 05-4511, 2006 U.S. Dist.

LEXIS 17556 (E.D. Pa. Apr. 6, 2006) (“April 6th Memo & Order”). I held Mr. Panetta

failed to satisfy the requirements of Federal Rule of Civil Procedure 23 (“Rule 23"). In 1

addition, I ordered the plaintiff to file an amended complaint in compliance with my

holding.

On April 18, 2006, the plaintiff filed a Class Action Second Amended Complaint. 

The new complaint contained class action allegations in direct contravention of this

court's April 6th Memo & Order. The new complaint also asserted a claim for quantum

meruit/unjust enrichment for the first time. On June 22, 2006, this court granted the

defendants' motion to strike the class action allegations and the claims for quantum

meruit/unjust enrichment. See Docket No. 46 (“June 22nd Order”). Mr. Panetta filed a

motion to reconsider the June 22nd Order and for leave to amend the complaint on July 5,

2006. 

II. MOTION FOR RECONSIDERATION OF ORDER DENYING CLASS CERTIFICATION

A. Motion to Reconsider Standard

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“The purpose of the motion for reconsideration is to correct manifest errors of law

or fact or to present newly discovered evidence.” Harsco Corp. v. Zlotnicki, 779 F.2d

906, 909 (3d Cir. 1985). A motion to reconsider is appropriate where: (1) there has been

an intervening change in controlling law; (2) new evidence has become available; or (3)

there is need to prevent manifest injustice or correct a clear error of law. See North River

Ins. Co. v. CIGNA Reins. Co., 52 F.3d 1194, 1218 (3d Cir. 1995); New Chemic (U.S.),

Inc. v. Fine Grinding Corp., 948 F. Supp. 17, 18-19 (E.D. Pa. 1996). 

“A motion for reconsideration is not intended to provide a losing party with a

second bite at the apple.” Yang v. AstraZeneca, No. 04-4626, 2005 U.S. Dist. LEXIS

18567, at * 2-3 (E.D. Pa. Aug. 29, 2005). It "is not properly grounded on a request that a

court reconsider repetitive arguments that have been fully examined by the court." Tobin

v. Gen. Elec. Co., No. 95-4003, 1998 U.S. Dist. LEXIS 693, at *4 (E.D. Pa. Jan. 27,

1998). The motion should "address[] only factual and legal matters that the court may

have overlooked. It is improper on a motion for reconsideration to ask the Court to

rethink what it had already thought through - rightly or wrongly." Glendon Energy Co. v.

Borough of Glendon, 836 F. Supp. 1109, 1122 (E.D. Pa. 1993) (citations and internal

alterations omitted).

B. Class Certification

In order for a plaintiff to successfully obtain class certification, the plaintiff must

satisfy the prerequisites of Rule 23(a). Pursuant to Rule 23(a), the plaintiff must

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Federal Rule of Civil Procedure 23(b) states: 2

An action may be maintained as a class action if the prerequisites of subdivision (a) are satisfied, and in

addition: 

(1) the prosecution of separate actions by or against individual members of the class would create a risk

of (A) inconsistent or varying adjudications with respect to individual members of the class which would

establish incompatible standards of conduct for the party opposing the class, or (B) adjudications with

respect to individual members of the class which would as a practical matter be dispositive of the interests

of the other members not parties to the adjudications or substantially impair or impede their ability to

protect their interests; or 

(2) the party opposing the class has acted or refused to act on grounds generally applicable to the class,

thereby making appropriate final injunctive relief or corresponding declaratory relief with respect to the

class as a whole; or

(3) the court finds that the questions of law or fact common to the members of the class predominate over

any questions affecting only individual members, and that a class action is superior to other available

methods for the fair and efficient adjudication of the controversy. The matters pertinent to the findings

include: (A) the interest of members of the class in individually controlling the prosecution or defense of

separate actions; (B) the extent and nature of any litigation concerning the controversy already

commenced by or against members of the class; (C) the desirability or undesirability of concentrating the

litigation of the claims in the particular forum; (D) the difficulties likely to be encountered in the

management of a class action.

Fed R. Civ. P. 23(b).

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demonstrate : “(1) the class is so numerous that joinder of all members is impracticable,

(2) there are questions of law or fact common to the class, (3) the claims or defenses of

the representative parties are typical of the claims or defenses of the class, and (4) the

representative parties will fairly and adequately protect the interests of the class.” Fed. R.

Civ. P. 23(a). In addition, the plaintiff must prove that the class is maintainable under one

of the categories of Rule 23(b). See Baby Neal v. Casey, 43 F.3d 48, 55-56 (3d Cir. 2

1994); In re Visa Check/MasterMoney Antitrust Litig., 280 F.3d 124, 132-33 (2d Cir.

2001). 

C. New Evidence

Mr. Panetta rests his motion for reconsideration on newly discovered evidence

grounds. He argues that as a result of information revealed at depositions of SAP

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“The commonality requirement will be satisfied if the named plaintiffs share at least one question of fact or

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law with the grievances of the prospective class. . . . Because the requirement may be satisfied by a single common

issue, it is easily met.” Baby Neal v. Casey, 43 F.3d 48, 56 (3d Cir. 1994) (citations omitted). “Typicality entails an

inquiry whether 'the named plaintiff's individual circumstances are markedly different or . . . the legal theory upon

which the claims are based differs from that upon which the claims of other class members will perforce be based. . .

. Factual differences will not render a claim atypical if the claim arises from the same event or practice or course of

conduct that gives rise to the claims of the class members, and if it is based on the same legal theory.” Id. at 57-58

(internal quotations and citations omitted). 

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corporate designees in June of 2006 the court should reinstate his class action claims. In

particular, he claims that defendant Matthew Iacoviello stated that "multiple folks" within

SAP were affected like Mr. Panetta by the change in the compensation plan in 2004. 

According to Mr. Panetta, this proves that at least 350 people “were not paid contractually

and legally earned commissions by Defendants” and this proof satisfies all four

requirements of Rule 23(a) - numerosity, commonality, typicality, and adequacy. Mr.

Panetta does not address Rule 23(b). 

Although Mr. Panetta may be correct regarding the satisfaction of several

requirements of Rule 23(a), Mr. Panetta ignores the second element of the class action 3

inquiry, i.e., Federal Rule of Civil Procedure 23(b). He does not indicate how this new

evidence eliminates what this court indicated was “[t]he more glaring deficiency in

plaintiff’s class action complaint, . . . its failure to comply with Rule 23(b).” Panetta v.

SAP Am., Inc., No. 05-4511, 2006 U.S. Dist. LEXIS 17556, at *7 (E.D. Pa. Apr. 6, 2006).

In fact, in the April 6th Memo & Order, the court considered what Mr. Panetta is

now classifying as new evidence. During the pendency of the defendants’ motion to strike

the class allegations, the plaintiff filed a Motion to File a Second Class Action Amended

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In my April 6th Memo and Order, the class was not certified under Rule 23(b)(3) because the plaintiff did 4

not show a “predominance” of common issues and the “superiority” of a class action as a means to litigate these

issues. One of the bases for both of these findings was that each class member’s claim would be litigated under

different state statutes. The court notes that the 2003 and 2004 Compensation Plans have a choice-of-law and

mandatory forum-selection clause and “all provisions of the plan must be construed, administered and enforced

according to applicable Federal law and the laws of the Commonwealth of Pennsylvania.” See Panetta v. SAP Am.,

Inc., No. C-05-01696 RMW, 2005 U.S. Dist. LEXIS 36813 (N.D. Cal. July 20, 2005). The plaintiff did not raise

this fact in support of his motion, but the court addresses the issue on its own for the sake of correctness. The court

finds those contract clauses would not affect its previous “predominance” and “superiority” holdings. Even if

Pennsylvania state law were to apply to all claims in Mr. Panetta’s putative class, the other grounds for my finding

regarding the satisfaction of Rule 23(b)(3) would lead to the same conclusion. Class certification would be denied

due to the individualized determinations that would still need to be made for each class member regarding: (1) the

contracts they worked on; (2) the time spent on and contribution to the contracts they worked on; (3) when the

contracts were “booked;” and (4) the impact of the various compensation plans on any earned commission. See In re

Chiang, 385 F.3d 256, 273 (3d Cir. 2004) (finding that under the predominance inquiry “[t]he common issues must

constitute a ‘significant part' of the individual cases"); In re LifeUSA Holding, 242 F.3d 136, 144 (3d Cir. 2001)

(noting the requirements of Rule 23(b)(3) promote the “uniformity of decisions of those similarly situated”); Meyer

v. CUNA Mut. Group, No. 03-602, 2006 U.S. Dist. LEXIS 4478, at *66 (E.D. Pa. Jan. 25, 2006) (“The

predominance inquiry focuses on whether the proposed class is sufficiently cohesive to warrant adjudication by

representation.”). With Mr. Panetta, we are dealing only with his efforts on one contract, the USPS contract. He

worked on the USPS contract, almost exclusively, between 2000-2004 and it was executed in 2004. Mr. Panetta’s

claims center on the facts and circumstances that surround the USPS contract and the proper commission owed him

based upon when the USPS contract was completed. 

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Complaint, estimating the number of plaintiffs as “over 300.” In the first footnote of the

April 6th Memo & Order striking the class action, the court stated: “Plaintiff attempts to

cure [the numerosity] defect in his Motion to File a Second Class Action Amended

Complaint, estimating the number of plaintiffs as ‘over 300.’ For the reasons discussed

below on why the class should not be certified for failure to comply with Rule 23(b), I will

deny the Motion to File a Second Class Action Amended Complaint as futile . . . .” 

Panetta, 2006 U.S. Dist. LEXIS 17556, at *6 n.1. The plaintiff’s motion, therefore, offers

absolutely no new evidence for this court to consider. The plaintiff does not present any

argument as to why his class action allegations now comply with Rule 23(b).

Accordingly, I will deny the plaintiff’s motion for reconsideration for failure to

offer any new evidence for this court’s consideration. 

4

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III. MOTION FOR LEAVE TO AMEND COMPLAINT TO ADD CLASS ACTION

ALLEGATIONS AND QUANTUM MERUIT/UNJUST ENRICHMENT CLAIM 

A. Standard to Grant Leave to Amend Complaint

Under Federal Rule of Civil Procedure 15(a), “[a] party may amend the party’s

pleading once as a matter of course. . . . Otherwise, a party may amend the party’s

pleadings only by leave of course . . . and leave shall be freely given when justice so

requires.” Fed. R. Civ. P. 15(a). “While this Rule also states that leave to amend should

be ‘freely given,’ a district court has discretion to deny a request to amend if it is apparent

from the record that (1) the moving party has demonstrated undue delay, bad faith or

dilatory motives, (2) the amendment would be futile, or (3) the amendment would

prejudice the other party.” Fraser v. Nationwide Mut. Ins. Co., 352 F.3d 107, 116 (3d Cir.

2003) (citing Foman v. Davis, 371 U.S. 178 (1962)).

B. Class Action Allegations

For the reasons stated above denying class certification, I will deny Mr. Panetta’s

request to amend his complaint to add class action allegations.

C. Quantum Meruit/Unjust Enrichment Claim

Mr. Panetta seeks the court’s permission to add an quantum meruit/unjust

enrichment claim to his complaint. He argues the court should liberally allow amendments

and that Rule 15(b) permits amendments to conform to the evidence. The basis for his

unjust enrichment claim is that he conferred on SAP and its management team the benefit

of the USPS contract and they did not fairly distribute the millions from the contract to

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him. The defendants argue the amendment to the pleadings should not be allowed because

it was made in bad faith, it would prejudice the defendants, and the cause of action is

futile.

Mr. Panetta initiated this case in March of 2005. When the case was transferred to

this court from California in August of 2005, Mr. Panetta amended his complaint for the

first time. At that time, any unjust enrichment claim was known to the plaintiff because

the cause of action arises out of the same set of facts as the breach of contract claim. It

was not until July of 2006, however, that Mr. Panetta first requested leave to add the

quantum meruit/unjust enrichment claim to his complaint. The undue delay in seeking to

amend the complaint again has not been explained. 

In addition, when Mr. Panetta filed this current motion, discovery was closed. The

defendants were preparing their motion for summary judgment, which was filed with this

court on July 14, 2006. As a result, any amendment to the complaint will prejudice the

defendants and their attorneys in their efforts and costs to defend this action. See Josey v.

John R. Hollingsworth Corp., 996 F.2d 632, 642 (3d Cir. 1993) (upholding a district

court’s authority to deny amendments to the pleadings after discovery has closed based on

the prejudice to the defendant).

Finally, the cause of action Mr. Panetta requests to add is futile. A claim of unjust

enrichment is defeated by the existence of an enforceable contract. See Schott v.

Westinghouse Electric Corp., 259 A.2d 443, 448 (Pa. 1969); see also Matter of Penn

Case 2:05-cv-04511-LS Document 62 Filed 09/20/06 Page 9 of 11
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Center Transp. Co., 831 F.2d 1221, 1230 (3d Cir. 1987); Synesiou v. DesignToMarket,

Inc., No. 01-5358, 2002 U.S. Dist. LEXIS 5687, at *13-15 (E.D. Pa. Apr. 3, 2002). 

"Under Pennsylvania law, 'the quasi-contractual doctrine of unjust enrichment is

inapplicable when the relationship between the parties is founded on a written agreement

or express contract.'" Hershey Foods Corp. v. Ralph Chapek, Inc., 828 F.2d 989, 999 (3d

Cir. 1987) (quoting Schott, 259 A.2d at 448 (Pa. 1969)). Here, during Mr. Panetta’s entire

employment with SAP, his compensation was determined by the terms of an annual

contract, i.e., the compensation plans. The parties agree that a contract always existed

between them and it governed the compensation of Mr. Panetta. The only dispute in this

matter is what annual compensation contract controls, i.e., what contract should be used to

determine the commission owed Mr. Panetta for his work on the USPS contract.

Accordingly, based on the undue delay by the plaintiff, the resulting prejudice to

the defendants, and the futility of the claim, I will deny the motion for leave to amend the

complaint to add a claim of quantum meruit/unjust enrichment.

IV. CONCLUSION

I will deny the plaintiff’s motion for reconsideration of this court’s Order of June

22, 2006, and for leave to amend the complaint to add class action allegations and a claim

of quantum meruit/unjust enrichment. An appropriate Order follows.

Case 2:05-cv-04511-LS Document 62 Filed 09/20/06 Page 10 of 11
IN THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF PENNSYLVANIA

LARRY PANETTA, : CIVIL ACTION

Plaintiff, :

:

v. : NO. 05-4511

:

SAP AMERICA, INC., et al., :

Defendants. :

ORDER

AND NOW, this 20th day of September, 2006, upon consideration of the

Plaintiff’s Motion for Reconsideration and for Leave to Amend the Complaint (Docket

No. 47), and the response thereto, it is hereby ORDERED that the motion is DENIED.

BY THE COURT:

 /s/ Lawrence F. Stengel 

LAWRENCE F. STENGEL, J.

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